Yahoo faces calls for board to step down

I'm the editor of City A.M's Life&Style section. We cover restaurants, film, theatre, the arts, technology, travel and motoring. I'm also the editor of our regular glossy magazines Bespoke (style, arts and culture), Living (design, architecture and property) and Travel (travel). When I'm not busy editing I write about restaurants, theatre and the arts. I was once named Young Journalist of the Year.

Follow Steve

Steve Dinneen

THE DEPARTURE of Carol Bartz appears to have done little to steady the ship at Yahoo, with a major investor yesterday calling for “sweeping” changes on the company’s board, including getting rid of the chairman.

Activist hedge fund manager Daniel Loeb, who revealed he has amassed a 5.15 per cent stake in Yahoo, applauded the axing of Bartz, calling her hiring a “serious misjudgement”.

But he demanded the immediate resignation of chairman Roy Bostock for championing her appointment, alongside fellow directors Arthur Kern, Vyomesh Joshi and Susan James, who he says stood by and watched as the firm floundered.

He said: “From the failed Microsoft sale negotiations, to a subsequent bungled and disappointing search deal with Microsoft, through a series of misguided chief executive selections, and most recently the Alipay debacle, this Board’s failures have destroyed value for all Yahoo stakeholders.

“Against this background, it is evident that merely replacing the Company’s chief executive – yet again – will not be enough to alter the direction of the company. Instead, a reconstituted board with new directors who will bring fresh eyes, relevant industry expertise and increased investor alignment to the table is immediately necessary.”

Loeb, whose Third Point fund manages $8bn (£5bn), has a reputation as an activist investor and is also a major fundraiser for President Obama.

The board also felt the infamously sharp tongue of Bartz yesterday when, in her first interview since leaving Yahoo, she accused Bostock of reading from a script when he fired her. She claimed she responded by saying: “Why don’t you have the balls to tell me yourself? I thought you were classier.”